I guess I should have been more explicit. I didn't mean to strike a partisan nerve.

I didn't mean to say that the CRA was the only cause for the housing bubble. There were a lot of factors that lead to the housing bubble.

My point was that the CRA was the beginning of a decade long non-partisan policy shift that signaled to regulators, Wall Street, etc. that owning a home was an unqualified good thing and looser standards for lending against homes should be encouraged.

Once the government and regulators signal to Wall Street other investors that they are encouraging the deployment of capital to a new, loosely regulated asset class it creates a dangerous environment.

Those do not extensively debunk the CRA's influence. At best, they split hairs and show that CRA is not completely at fault and that we should blame Wall Street. I'm on board with blaming Wall Street for a lot of the problems (they went much further beyond rationally using the CRA's policies and instead went whole hog into "lend to everyone!"), but this strikes of "Sure, the legislation created perverse incentives and encouraged risky lending practices (which unsurprisingly spiraled much further out of control than the CRA intended into non-CRA covered loans), but the real problem is the people who acted on these perverse incentives!"

If you assume that every single CRA loan defaulted, and that every failed loan in the entire housing market was a CRA loan (both assertions are far from true), then the CRA would be responsible for a multiple billion dollar problem. Maybe. Might be well under 1b when you consider that the homes are re-sellable after foreclosure unless they burned without insurance.

On Wall St, we wound up with a multiple trillion dollar problem. That's tr-, not b-, as in 1,000X bigger.

The CRA thing is ideological bullshit. I seriously do not understand how anyone who passed 3rd grade arithmetic could buy into it.

Note also that it's a perfectly fine position to have to think the CRA is a bad idea while also recognizing how ridiculous the idea is that it caused the bubble.

It's a sad commentary that this point needs to be made, though.